The Japan Syndrome

In the 1979 movie "The China Syndrome," reporter Kimberly Wells (played by Jane Fonda) witnesses an accident at a nuclear power plant and then uncovers a plot to keep it a secret in order to protect the power company's billion-dollar investment. The film was a gift to the political left, which at the time opposed the pursuit of nuclear energy to reduce our addiction to foreign oil. In some liberal circles, that opposition remains strong.

The film, along with real-life accidents such as Three Mile Island (also in 1979), in which no one was killed, and Chernobyl (1986), which, according to the World Nuclear Association, "killed two Chernobyl plant workers on the night of the accident, and a further 28 people within a few weeks, as a result of acute radiation poisoning," account for much of our modern thinking about all things nuclear. Other films, like "Dr. Strangelove," "Fail-Safe" and "On the Beach" -- along with the bombing of Hiroshima and Nagasaki, which ended World War II and launched the Cold War with the Soviet Union in which "mutual assured destruction" (MAD) and civil defense drills became the norm -- make us nervous about what the unrestrained power of the atom can do.

The nuclear reactors at Japan's Fukushima Dai-ichi nuclear plant were damaged by the tsunami, not the earthquake, and not by faulty construction or worker error, as was the case at Chernobyl and to a lesser extent Three Mile Island. The U.S. Nuclear Regulatory Commission has significantly tightened standards since those incidents, but no regulation or safety precaution can offer a 100 percent guarantee against an accident or natural disaster.

Politicians tend to overreact to such things and stoke public fear. The otherwise cautious and principled German Chancellor Angela Merkel quickly announced plans to shut down seven of her country's nuclear power plants pending a safety review.

U.S. Energy Secretary Steven Chu, a proponent of nuclear energy, told members of a House subcommittee on Tuesday that, "The American people should have full confidence that the United States has rigorous safety regulations in place to ensure that our nuclear power is generated safely and responsibly." He faces off against nuclear energy opponents, including Rep. Ed Markey (D-MA), who was recently quoted as saying, "We have to listen to what is happening in Japan and protect ourselves and our people." Run for the hills! Chicken Little lives!

The Houston Chronicle quoted Peter Cardillo, chief market economist for Avalon Partners, a brokerage house in New York: "It's a situation where you sell (your stocks now), and you ask questions later," thus indulging in self-fulfilling prophecy as Japanese and American markets dipped.